Recently, someone came to us looking for a piece of land to buy around Nairobi. They wanted somewhere they could develop some apartments but did not want to spend huge amounts of cash on land alone. In Nairobi, developers end up spending us much as 60% of their project investment on land alone. So for us the task was simple, get land in a fast growing pocket near Nairobi with a huge potential for future growth. In this blog, I will be taking you through the detailed land analysis steps we did in securing a piece of land at their budget in a rapidly growing area.
Checking their Budget
Everything boils down to a client’s budget. Being open about how much you are willing to spend allows your land agent to source the best deal for you. Many people are afraid of getting over-exploited if they announce they have a lot of money. But trust in this business is everything. Our client revealed they were willing to spend a maximum of 1 million shillings on the land and this was our starting point.
Places to look
After revealing his budget, things were now much easier for us. We knew exactly what areas to look in and what plots there were going for. In Nairobi and its suburbs, 1 million might not be enough to get a plot and by knowing this we never wasted our time there. However, there are some pockets near Nairobi that are either unknown or were recently earmarked for growth.
This is what people nowadays call “Hidden Gems” or in much formal language greenfield land. From our research we were able to locate a growing area near eastern by-pass called Infinity City. The area was still untapped but basic amenities were available. Electricity was connected but not to all plots, piped water was also not an issue.
Also check-out for land sub-division schemes.
Aerial View of the change
Below are some Google earth images showing how the area has grown overtime. I would like for you to focus on the manner in which buildings have increased in number in just a span of a few years. The area goes from a bear wasteland, to an upcoming suburb quite fast. I have done a time lapse from 2017 – 2024 and the images are shown below.
year 2017
Our analysis of the area first shows it during 2017. As you can see, the area looks pretty empty without much action. At the time, this would have been a great place to buy speculatively.
Year 2021
Four years later in 2021, the area began witnessing some growth. In the image below you can see some buildings coming up.
Year 2024
In 2024, the development is much clearer and many apartment and residential blocks are visible. When I was there recently, this development has multiplied.
About land at infinity city
Based on our client’s budget and their intention with the plot, we were able to get a good 33’ x 66’ plot of land in Infinity City for Ksh. 800,000. The area is part of Kasarani that touches the eastern bypass neighboring Ruai. It is growing to become a major commercial hub with lots of Go-downs and industries being located there. In fact, WHO’s regional cold storage center is just a few minutes from the place.
Being a newer area prices are definitely low for the types of developments around the area. That is why we believe that with more infrastructure coming into the place, land prices will begin to hike drastically. Moreover, the working class people in most of these industries have pushed the demand for apartments quite up. And most of the tenants you would get in such a place are high quality tenants who come with very low chances of defaults.
Rents in Infinity City are quite affordable for renters and they present good returns to developers as well. 1-bedrooms range from 8,000 – 12,000; 2-bedrooms from 12,000 – 17,000 depending on the location and build quality of the unit. Bedsitters are also available but not in plenty as the area sits a more mature demographic. This means that developers that target small & medium families are likely to get tenants throughout.
Questions Asked in the site visit
During the site visit, we asked some questions that enabled us to get the relevant information we needed to make the best recommendation to our client.
- Who owned the development? – this is the history of the area which traces back to its first owners who happened to be the Langata Development Company.
- What is the price range of plots? – we asked this to get a feel for the price we were going to offer. It also made the agents quite willing to move us to a couple of lots as they didn’t know what we were willing to spend.
- What developments; current, ongoing and future were available? – currently we could see numerous go-downs and ware houses homing up. As mentioned, a world class cold storage unit from the WHO was minutes away as well as a recently opened mall called Waris mall. Schools were also being built and we spotted a government primary school being constructed.
- Were there ready titles? – Yes, we confirmed that titles were ready which gave us a sign of security in the land which is what our customer wanted.
- How deep did foundations of most buildings reach? – seeing that they wanted to put up an apartment block in future, we had to ask this question. The people were truthful and they informed us that depending on the Block we bought, foundation depths often varied. We settled on an area where foundation costs would not cost them a fortune.
Transferring the plot
After agreeing on a price with the seller and doing our fair share of due diligence, we decided to buy. Buying should NEVER be done in cash and doing a Bank-Transfer or a RTGS transfer is a much safer option for both parties. After that, we decided to do the plot transfer which followed the steps below. This is not the same for all plot sales, but the process should not be that far of.
- Verifying the plot documents at Lang’ata development company offices
- Obtaining confirmation of the plot on site
- Verifying the identity card of the seller with the registrar of persons/ ID at N.S.S.F building 7th floor.
- Verify fingerprints at the relevant government office (Get direction at N.S.S.F)
- Purchase to obtain a letter of indemnity absolving Lang’ata from any future unforeseen legal or otherwise issue.
- Deposit the purchase/consideration price in a bank (No Cash Transaction)
- Verify the owner through an M-pesa transaction
- Provide 2 passport sized photos
- Transfer the plot.
- Provide K.R.A Pin
